Nordic Credit Rating (NCR) has affirmed its 'A-' long-term issuer rating on Norway-based savings bank JBF Sparebank. The outlook is stable. The 'N2' short-term issuer rating, 'A-' senior unsecured issue ratings, 'BBB+' Tier 2 issue rating, and 'BBB-' Additional Tier 1 issue rating have also been affirmed, in accordance with NCR's revised financial institutions rating methodology. The ratings are no longer under criteria review.
Rating rationale
NCR has reviewed its long-term and short-term issuer ratings, issue ratings, and outlook on JBF Sparebank following the revision of its methodology for assigning ratings to financial institutions (see Related publications). We consider that our amendments to the methodology have not had a material impact on our view of the bank's creditworthiness, and that there have not been significant changes in its overall risk profile. Consequently, we have affirmed our ratings and maintained the stable outlook on the ratings on JBF Sparebank.
Stable outlook
The stable outlook reflects JBF Sparebank's strong capital and likely low credit losses due to a high share of residential real-estate collateral. It also factors in the bank's robust earnings and cost efficiency improvements in recent years, offset by a likely decline in net interest margins over the next few years. We forecast sustainable loan growth through 2027, with capital ratios improving and boosted further by the implementation of CRR3.
We could raise the rating to reflect the bank's strengthened market position and increased scale, combined with pre-provision earnings sustainably above 2.5% and a cost-to-income ratio sustainably below 45%.
We could lower the rating to reflect a material deterioration in the Norwegian housing market or weakened asset quality, a lasting reduction in the bank's Tier 1 capital ratio to below 18%, or risk-adjusted earnings metrics sustainably below 1.5% of the risk exposure amount.
Related publications
i) JBF Sparebank 'A-' long-term issuer rating affirmed; Outlook stable, 30 Apr. 2025.
ii) Nordic Credit Rating publishes amended Financial Institutions Rating Methodology, 12 May 2025.
| Rating list | To | From |
|---|---|---|
| Long-term issuer credit rating: | A- | A- |
| Outlook: | Stable | Stable |
| Short-term issuer credit rating: | N2 | N2 |
| Senior unsecured issue rating: | A- | A- |
| Tier 2 issue rating: | BBB+ | BBB+ |
| Additional Tier 1 issue rating: | BBB- | BBB- |
Contacts:
Christian Yssen, analyst, +4740019900, christian.yssen@nordiccreditrating.com
Sean Cotten, chief rating officer, +46735600337, sean.cotten@nordiccreditrating.com
Geir Kristiansen, analyst, +4790784593, geir.kristiansen@nordiccreditrating.com
The methodology documents used for this rating are NCR's Financial Institutions Rating Methodology published on 12 May 2025, NCR's Rating Principles published on 14 Feb. 2024 and NCR's Group and Government Support Rating Methodology published on 14 Feb. 2024. For the full regulatory disclaimer please see the rating report.